Harvia Plc announces the preliminary price range for its planned initial public offering and further information about the listing of its shares on the official list of Nasdaq Helsinki Ltd

HARVIA PLC PRESS RELEASE 8 MARCH 2018 AT 2.40 P.M. EET

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, NEW ZEALAND, AUSTRALIA, JAPAN, HONG KONG, SINGAPORE OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

Harvia Plc (“Harvia” or the “Company “) announces the preliminary price range for the share issue and the share sale (initial public offering, “IPO” or the “Offering”) in connection with its planned listing (the “Listing”). The Company announced on 5 March 2018 that it is planning an initial public offering and listing of its shares on the official list of Nasdaq Helsinki Ltd (the “Helsinki Stock Exchange”).

The IPO in brief:

• The preliminary price range of the Offering is EUR 5.00-6.10 per share (the “Preliminary Price Range”).
• The Company aims to raise gross proceeds of approximately EUR 45 million by offering new shares in the Company (the “New Shares”) for subscription (the “Share Issue”). The number of New Shares to be issued will be determined based on the final subscription price per share for the Offer Shares (as defined below) (the “Final Subscription Price”).
• The Company would issue 8,118,109 New Shares assuming that the Final Subscription Price would be at the mid-point of the Preliminary Price Range and that the persons eligible for subscribing for shares in the Personnel Offering (as defined below) would subscribe for a total of 100,000 New Shares in the Personnel Offering (as defined below) at the discounted subscription price applicable to such New Shares.
• The market capitalisation of the Company based on the Preliminary Price Range is approximately EUR 93-104 million assuming that the Company raises gross proceeds of approximately EUR 45 million in the IPO.
• CapMan Buyout X Fund A L.P and CapMan Buyout X Fund B Ky (together the “Funds Managed by CapMan”) and certain other existing shareholders of the Company (together with the Funds Managed by CapMan, the “Sellers”) will offer for purchase initially a minimum of 1,250,729 and a maximum of 1,462,418 existing shares of the Company (the “Sale Shares” and together with the New Shares, the “Offer Shares”) (the “Share Sale”).
• The members of the Board of Directors of the Company and the members of its Management Team or other shareholders employed by the Company will not sell shares in the IPO and have agreed to customary lock-up restrictions.
• The Offer Shares are offered for subscription (i) by private individuals and corporations in Finland (the “Public Offering”), (ii) by all permanent employees of the Company or its wholly owned subsidiaries in Finland and Austria during the subscription period and the members of the Board of Directors and CEO of the Company (the “Personnel Offering”), and (iii) in private placements to institutional investors in Finland and internationally pursuant to the applicable legislation (the “Institutional Offering”). Only New Shares will be offered in the Personnel Offering and a 10 per cent lower subscription price than the Final Subscription Price will be applied in the Personnel Offering.
• The Offer Shares represent a maximum of 53.3 per cent of the Company’s Shares (the “Shares”) and all votes in the Company after the Share Issue without the Over-allotment Option (as defined below) (with the Over-allotment Option 61.3 per cent) assuming that the Sellers sell 1,367,063 Sale Shares and that the Company issues 8,118,109 New Shares (the number of Sale Shares and New Shares is calculated assuming that the Final Subscription Price for the New Shares is at the mid-point of the Preliminary Price Range and that a total of 100,000 New Shares are subscribed for in the Personnel Offering at the discount applicable to such New Shares).
• The value of the IPO based on the Preliminary Price Range is approximately EUR 59-62 million assuming that the Company raises gross proceeds of approximately EUR 45 million, a minimum of 1,250,729 and a maximum of 1,462,418 Sale Shares are sold in the Share Sale and assuming that the Over-allotment Option (as defined below) is exercised.
• Before the IPO, the Funds Managed by CapMan hold approximately 69.5 per cent, the Board of Directors and the members of the Management Team hold in total approximately 17.2 per cent and other shareholders approximately a total of 13.3 per cent of the Shares. The members of the Board of Directors and the Management Team or other shareholders employed by the Company will not sell Shares in the Share Sale.
• If the IPO is implemented as planned, Funds Managed by CapMan will hold approximately 25.3 per cent of the Shares and votes in the Company immediately after the IPO assuming that the Company issues 8,118,109 New Shares (the number of Sale Shares and New Shares is calculated assuming that the Final Subscription Price for the New Shares is at the mid-point of the Preliminary Price Range and that a total of 100,000 New Shares are subscribed for in the Personnel Offering at the discount applicable to such New Shares) and that the Over-allotment Option is exercised.
• The Company has appointed Danske Bank A/S, Finland branch to act as the global coordinator and bookrunner in the IPO (the “Global Coordinator” or “Danske Bank”) and Handelsbanken Capital Markets, a part of Svenska Handelsbanken AB (publ) to act as the bookrunner in the IPO (the “Bookrunner” or “Handelsbanken Capital Markets” and together with the Global Coordinator, the “Bookrunners”).
• In the event of oversubscription, the Funds Managed by CapMan and the Global Coordinator may additionally agree on that the Global Coordinator has a right, exercisable within 30 days from commencement of trading in the Company’s shares on the Helsinki Stock Exchange, to purchase up to 1,539,109 Shares solely to cover potential oversubscription situations (the “Over-allotment Option”). The additional shares correspond to approximately 15.0 per cent of the Offer Shares and votes granted by them assuming that the Final Subscription Price is the lowest price of the Preliminary Price Range.
• The subscription period for the Public Offering will commence on 9 March 2018 at 10 a.m. and end on or about 19 March 2018 at 4 p.m.
• The subscription period for the Institutional Offering will commence on 9 March 2018 at 10 a.m. and end on or about 21 March 2018 at 12 noon.
• The subscription period for the Personnel Offering will commence on 9 March 2018 at 10 a.m. and end on or about 19 March 2018 at 4 p.m.
• Trading in the Shares is expected to commence on the Pre-list of the Helsinki Stock Exchange on or about 22 March 2018 and on the official list of the Helsinki Stock Exchange on or about 26 March 2018 under the trading code HARVIA.

CEO Tapio Pajuharju:

“Since 2014 we have expanded our product offering, increased our international presence and improved our market position. The IPO enables us to continue developing our operations further. I believe that we are in good position to continue our profitable growth in accordance with our strategy to become the leading sauna and spa company.”

Chairman of the Board of Directors Olli Liitola:

“We are more than satisfied with Harvia’s operational performance in the past years. Harvia is a strong player in a historically stable and growing market. I believe that Harvia is ready to take the next step and the contemplated IPO and listing mark an important milestone in Harvia’s development and enable the company’s continued growth track, strengthen the Harvia brand, and provide further support in the recruitment and engagement of key personnel.”

Member of the Board of Directors and representative of CapMan Anders Björkell:

“CapMan invested in Harvia four years ago, and we saw an IPO as an attractive target for the Company. We have been developing Harvia towards that target and during the last few years, Harvia’s business and financials have developed very steadily. Harvia has a very strong foundation to continue executing its strategy as a listed company. CapMan will stay on as a significant shareholder also after the IPO.”

Background and reasons for Listing

The objective of the IPO and the Listing is to improve the Company’s ability to implement its strategy successfully by offering the Company with access to capital markets and strengthening the Company’s capital structure as well as increasing the Company’s recognition among customers and attractiveness as an employer. The IPO will also allow the Company to broaden its ownership base and to increase the liquidity of the Shares, as well as to use the Shares as a means of consideration in potential acquisitions. The listing of the Shares on the official list also enables the Company to offer its key personnel market-based incentive schemes and strengthens the employer image.

The Company expects to use the net proceeds from the IPO for strengthening its capital structure by a way of repaying the principal and accrued interests of the shareholder loans that mature at the completion of the Listing. A strengthened capital structure better enables the Company to promote its growth strategy in the future.

Listing and publication of the Finnish-language listing prospectus

The Company’s shares have not been subject to trading on a regulated market or a multilateral trading facility before the IPO. The Company intends to apply for listing of its shares on the official list of Helsinki Stock Exchange. Trading in the Shares is expected to commence on the Pre-list of the Helsinki Stock Exchange on or about 22 March 2018 and on the official list of the Helsinki Stock Exchange on or about 26 March 2018.

The Company has submitted a Finnish-language listing prospectus for approval by the Finnish Financial Supervisory Authority. The Finnish-language listing prospectus is expected to be approved on or about 8 March 2018. The Finnish-language listing prospectus and the marketing brochure are available through the Company’s website www.harvia.fi/ipo on 9 March 2018 before the commencement of the subscription period. The Finnish-language listing prospectus is available in print on or about 12 March 2018 at the Company’s headquarters at Teollisuustie 1-7, FI-40951 Muurame, Finland, at the branch offices of Danske Bank in Finland and at the service point of Helsinki Stock Exchange at Fabianinkatu 14, FI-00100 Helsinki, Finland.

Further information about the IPO and places of subscription is available on the websites at www.harvia.fi/ipo, www.danskebank.fi/issues and www.handelsbanken.fi/listautumisannit as well as at the branch offices of Danske Bank in Finland.

Important Dates:

Danske Bank and Handelsbanken Capital Markets act as the Bookrunners of the IPO. Borenius Attorneys Ltd acts as the legal advisor to the Company. Castrén & Snellman Attorneys Ltd acts as the legal advisor to the Bookrunners.

Harvia in short

Harvia is one of the leading companies operating in the sauna and spa market globally, as measured by revenue.^[1] Harvia’s brands and product offering are well-known in the market^[2] and the Company’s comprehensive product offering strives to meet the needs of the international sauna and spa market, of both private and professional customers.

Harvia’s revenue amounted to EUR 60.1 million in 2017, its operating profit was EUR 9.3 million and adjusted operating profit EUR 10.7 million during the same period. The Company employs some 365 professionals in Finland, China and Hong Kong, Romania, Austria, Germany and Estonia. The company’s headquarters in Muurame, Finland are adjacent to its largest sauna and sauna component manufacturing facility.

Additional information:

Tapio Pajuharju, CEO
tel. + 358 50 577 4200
tapio.pajuharju@harvia.fi

Ari Vesterinen, CFO
tel. +358 40 505 0440
ari.vesterinen@harvia.fi

Olli Liitola, Chairman of the Board of Directors
tel. +358 40 060 5040
olli.liitola@capman.com

Disclaimer

The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States, Canada, New Zealand, Australia, Japan, Hong Kong, Singapore or South Africa. The information contained herein does not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. Harvia Plc (the “Company”) does not intend to register any portion of the contemplated offering in the United States or to conduct a public offering of securities in the United States.

The issue, exercise and/or sale of securities in the initial public offering are subject to specific legal or regulatory restrictions in certain states. The Company, Danske Bank A/S, Finland Branch and Handelsbanken Capital Markets, a part of Svenska Handelsbanken AB (publ), assume no responsibility in the event there is a violation by any person of such restrictions.

The information contained herein shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale or offer of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities referred to in this release, unless they do so on the basis of the information contained in the prospectus published or offering circular distributed by the Company.

The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland, and which has implemented the Prospectus Directive (each, a “Relevant Member State”), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State. As a result, the securities may only be offered in Relevant Member States (a) to any legal entity which is a qualified investor as defined in the Prospectus Directive; or (b) in any other circumstances falling within Article 3(2) of the Prospectus Directive. For the purposes of this paragraph, the expression an “offer of securities to the public” means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied by any measure implementing the Prospectus Directive in that Relevant Member State and the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

This communication is directed only at (i) persons who are outside the United Kingdom or (ii) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) and (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as “Relevant Persons”). Any investment activity to which this communication relates will only be available to and will only be engaged with, Relevant Persons. Any person who is not a Relevant Person should not act or rely on this document or any of its contents.